Busey income drops 16 percent
CHAMPAIGN — First Busey Corp. reported a 16 percent decrease in first-quarter net income, compared with a year earlier.
In announcing the results, the Champaign-based parent of Busey Bank also said it's working to contain costs following a year in which salaries and employee benefits rose sharply.
First Busey's net income for the quarter that ended March 31 was $6.4 million, down from $7.6 million for the comparable quarter in 2012.
For shareholders, that amounted to earnings of 6 cents a share, down from 8 cents a share a year earlier.
In a letter to shareholders, CEO Van Dukeman said the year-ago results were affected by a $2.1 million gain on the company's private equity funds.
The most recent quarter's results benefited from only "nominal" gains, he said.
Dukeman noted that salaries and employee benefits went up last year as the bank invested in "additional talent to drive future business expansion."
But he said the company plans to "selectively offset planned expense growth with prudent reductions in other areas."
Dukeman said First Busey evaluated ways to reduce costs and enhance efficiency.
"That evaluation resulted in personnel reductions and other cost-containment efforts in recent months which are expected to maintain or slightly reduce staffing costs" going forward, he said.
Also, Dukeman said senior management proposed reducing compensation for the company's executive officers, and a committee of the board of directors approved that move, which took effect in April.
In other comments, Dukeman said the bank's first-quarter loan loss provision was the lowest in four years, and gross commercial loan balances are up from a year ago. Altogether, loan balances were 2.7 percent higher on March 31 than they were a year earlier.
Busey Bank's asset quality is improving on several counts. However, loans 30 to 89 days past due rose to $7.1 million on March 31, up from $2.3 million on Dec. 31, but down from $15.9 million a year earlier.
Dukeman noted several encouraging economic factors in First Busey's markets. He said the median sales price of homes in central Illinois exceeds statewide averages, and home sales are up by double-digit percentages. He also said unemployment rates are improving in southwest Florida.
First Busey, with $3.6 billion in assets, is the parent company of Busey Bank, Busey Wealth Management and FirsTech, a retail payment processing subsidiary.
Busey Bank has 28 banking centers in Illinois, seven in southwest Florida and one in Indianapolis.